Without a doubt, the ongoing pandemic has had a devastating effect on a wide range of industries, effectively rendering some of them obsolete. Even though the gambling industry has been severely impacted by global lockdowns, the digital portion of the industry has not only survived but has thrived during this period of uncertainty.
Online gambling operators saw an increase in user activity in 2020, and current estimates predict that the market will be worth 127 billion dollars by 2027. A figure that is higher than previous estimates and nearly doubles the size of the existing market.
As early as the first week of March, when land-based businesses ceased operations and remained closed throughout most of the world until at least June, there was a discernible shift from offline to online activity within the sphere. As a result of this trend, many operators were forced to digitalize their gaming services and expand their offerings by making them available online.
Bets on sports that do not take place
In March, a never-before-seen phenomenon caused sporting events all over the world to be abruptly canceled. Television sports networks were forced to purchase the rights to air matches from leagues in countries where there were no restrictions on the number of teams that could compete. The Belarusian Premier Football League was once the most watched competition on the planet because it was the most popular league in existence at the time. The lack of activity and commerce during that period harmed both bookmakers and bettors.
According to the American Gambling Association, approximately $150 billion in illegal bets are placed in the United States each year, with the majority of those bets going to college and NFL football games. Lobbyists attempting to pass sports betting legislation frequently use this figure in their arguments.
Following the Supreme Court’s decision in 2018 to strike down the Professional and Amateur Sports Protection Act, state laws have been passed that not only make sports betting legal, but also allow for betting via mobile apps. Americans wagered $2.1 billion in a single month in August of 2020, setting a new record for a single month. The majority of the $119.4 million in revenue generated by sportsbooks came from online wagering, which accounted for 80 percent of the total. The number of people attending sporting events in New Jersey increased by 31.5 percent in the first eight months of 2019.
According to Zion Market Research, betting on sporting events accounts for roughly 70% of total gambling revenue worldwide. This percentage is higher than that generated by any other sector. The vast majority of online bettors bet on sports, with 42.5 percent of European online gamblers betting on some form of athletic competition. Baseball, according to Zion, is the world’s second most popular sport for betting after football.
888 Holdings, a multinational gaming company headquartered in Gibraltar, recently announced that it expects revenues to increase by 45 percent in 2020. Furthermore, the company has successfully negotiated access agreements to launch its digital sportsbooks in three new states in the United States.
Given the positive signs regarding the possibility of new regulations in Germany and other currently restricted markets, the company maintains a very optimistic outlook for its sports website. Despite a general decline in numbers, VGC Holdings, a British operator, reported a 19 percent increase in online figures for the first half of the year. Even though overall numbers were lower, this was the case.
According to Newzoo’s estimates, the global eSports market will generate approximately $1.1 billion in revenue in 2020, representing a 15.7 percent increase over 2019.
Profits from Internet Gambling
According to a Concordia University article, the mentioned migration will result in an increase of 13.2 percent in online gambling revenue for the year 2020. This estimate is based on a report from ResearchAndMarkets.com, which is cited in the article. The market is currently worth 66 billion dollars.
According to the American Gaming Association, there are currently over 2,800 betting sites open for business. According to OnlineUnitedStatesCasinos.com, the central information hub for reviews of online casinos in the United States, all of these sites saw a significant increase in traffic in February of this year, particularly online poker platforms. According to Global Poker, the number of first-time US player signups has increased 255 percent since the lockdowns began. This has led many people to speculate that another poker boom may soon be on the horizon.
Online casinos are also gaining traction in the United States, with an increasing number of states considering legislation to make these platforms legal in the hopes of attracting new tax revenue. According to reports from industry operators in Canada, the internet casino sector grew by 77 percent in the same period last year.
According to the New Jersey Department of Gaming Enforcement (DGE), revenues from online gambling have increased every month in 2019, including an 87 percent increase in November. To date in 2019, online gaming has generated more than $870 million in revenue for the state of New Jersey, a 101 percent increase over last year.
Pennsylvania’s online casino and poker room operators are also setting new records. The state’s online casinos earned $57.3 million in October, while online poker rooms earned $2.4 million. Both figures have risen since the beginning of the year.
The same pattern can be seen in Europe. In Italy, revenue from online poker tournaments has increased by 123 percent, while revenue from cash games has increased by 89 percent. According to Ficom Leisure, a consulting firm, the iGaming industry in Italy expanded by 25.4 percent this year.
According to data provided by the General Directorate of the Spanish Regulator, numbers in Spain are also on the rise, increasing by 18% in the second quarter of 2020. According to the UK Gambling Commission’s semi-annual report on industry statistics, the amount of time spent gambling online has increased by 8.1% across the union’s four member countries. Over the next five years, the European industry as a whole is expected to grow at a compound annual growth rate of 9.2 percent.
Argentina, Brazil, Colombia, Chile, and Peru are leading the expansion of the South American market, which is currently experiencing rapid growth. Even though gambling is legal in 75 percent of the region’s population, it is not regulated in any of the South American countries. As a result, many people end up playing on sites that are based in other countries.
The same is true for people living in Asia and Africa, where the majority of countries either have no regulations governing internet gambling or outright prohibit it. As a result, there is little information available about these markets. Nonetheless, according to a report published on ResearchandMarkets.com, digital betting in the Asia-Pacific region will grow at a 7 percent annual rate until 2024. This expansion is expected to begin in 2020.
The novel coronavirus, as well as government-imposed guidelines, have hurt land-based gambling casinos and other venues in the leisure activity, entertainment, and hospitality industries.
Macau, the world’s largest gambling hub, predicts that revenues will fall by 80% this year. The Asia-Pacific region accounts for 38% of the global market. Experts predicted that November would be 65 percent lower than November in 2019. Despite this, the final tally was $845 million, a 70.5 percent decrease.
This indicates that the market is still underperforming. Many people believe that the worst of the damage has been done to Macau’s casinos and that they are on the mend.
Macau may not be doing as well as Las Vegas, but that is insignificant given how well Macau is doing. The Nevada Gambling Commission released statistics demonstrating that the state’s casinos are quickly recovering. The monthly figures show a decline in revenues ranging from 18% to 36%, but the commission noted that the casinos are quickly recovering.
The situation is not ideal, but experts predict that by the end of 2021, conditions will have returned to pre-pandemic levels. Some people are more pessimistic and believe that this will not happen until 2023. The figures for Atlantic City are down 21.5 percent from the same period the previous year.
According to a May analysis published on ResearchAndMarkets.com, the market is expected to fall from $521 billion in 2019 to $495 billion in 2020, then rise to $592 billion in 2023. In contrast, a forecast published in August by ReportLinker.com predicts that the global casino market will contract by 10.8 percent by 2020.
The data and research methods used by various businesses result in findings that differ from one another. As a result, determining who’s estimates are correct is difficult.
On the other hand, one thing that everyone agrees on, and which government commission reports show, is that online gambling is on its way to becoming the norm, with a growing demand for mobile betting. This is something on which everyone can agree, as evidenced by reports from government commissions. Even though land-based casinos are beginning to offer mobile apps and contactless payments, they cannot compete with the convenience that mobile betting apps provide.
These platforms aim to improve user interaction and make the overall experience more social. It’s likely that once the world recovers from this crisis, the habits that people developed during the pandemic will persist. As a result, revenues from online gambling are expected to rise by $27 billion over the next three years.